Germany backs ending EU import tax breaks for Shein and Temu. This change could affect their ability to offer low-cost products by eliminating the current €150 exemption, increasing scrutiny on imports, and impacting their business strategies.
Germany recently announced its support for ending EU import tax breaks, a move targeting online retailers like Shein and Temu. Currently, parcels from outside the EU valued under €150 are exempt from customs duties. This exemption allowsShein and Temu to sell products at lower prices compared to their EU competitors. Removing this tax break could level the playing field for European businesses.
Shein and Temu rely heavily on these tax breaks to keep prices low. Critics in the US have also highlighted their use of similar exemptions to undercut local retailers. If the EU tax breaks are removed, Shein and Temu may face higher costs and increased scrutiny of their imports. This could affect their competitive pricing and rapid growth in the European market.
The potential changes are part of broader EU customs reforms. These reforms aim to ensure imported goods meet EU standards. Shein, planning to go public in New York, may face significant challenges if these tax breaks are removed. Increased inspections could lead to more compliance checks on product safety, labor laws, and production standards.
Temu has been criticized for manipulative practices and non-compliance with EU rules, making it hard for consumers to delete accounts and track suppliers. Shein has faced scrutiny for sourcing materials from Xinjiang, violating labor laws, and health hazards associated with its products. These issues highlight the importance of robust import regulations to protect consumers and ensure fair competition.
Will ending EU tax breaks make shopping fairer for EU consumers?
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